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An Employer’s Dilemma in Providing a Recommendation for a Former Employee

As all employers can attest, it can be difficult to determine what information to provide in a verbal or written recommendation for departing employees. Indeed, some managers find themselves dreading a phone call from a prospective employer of a former employee. That sense of dread is driven by concerns about liability for saying something less than flattering about the former employee that will dash the prospects of employment on one hand, and saying something that is overly generous and misrepresents the talents or abilities of the former employee on the other. The purpose of this article is to give employers some guidance on how to avoid awkward and potentially actionable discussions with prospective employers of former employee.

The safest approach is to adopt a policy that restricts company representatives to simply providing dates of employment, job title and rates of pay (the so-called “neutral reference”). The beauty and the problem with a neutral reference are the same: it offers exactly no useful information concerning the former employee’s abilities and talents. A prospective employer cannot ascertain whether the employee is flawed in some material respect and may interpret the neutral reference as a nod to the age-old advice that one who lacks nice things to say should refrain from saying anything at all. To make matters worse, if the former employee departed under circumstances giving rise to a potential employment dispute, a neutral reference may harm the former employer’s interests by hindering the former employee’s efforts to secure new employment, thereby potentially increasing the likelihood of damages in the employment dispute.

As human beings, we are frequently tempted to offer positive recommendations to former employees. Sometimes we genuinely like the former employee and we want to assist the him or her in obtaining a new position, and sometimes we simply want to be rid of a former employee and to minimize the drama associated with his or her departure. However, it is important to recognize that there are risks associated with giving a glowing recommendation to a former employee, particularly if the former employee’s performance was lacking in some respect. Consider a situation where the former employee quits in the wake of a series of negative performance evaluations or reprimands. If the former employer offers an effusive (or even marginally positive) recommendation to a future employer, the former employer may inadvertently bolster a future claim of discrimination or retaliation by an employee who capitalizes on the discrepancy between the negative content of the pre-separation reviews and the positive content of the recommendation.

There are also obvious risks associated with providing a prospective employer with negative information. Although many states, including New Mexico, provide statutory immunity to former employers who have offered accurate information about a former employee, there is plenty of room for disagreement between the former employer and a disgruntled employee about the accuracy of the information provided. That said, there may be situations where the former employer feels morally obligated to warn a future employer regarding serious safety concerns or criminal behavior of a former employee.

So what is a risk-adverse employer to do? Development of a clear policy concerning how the company plans to respond to requests for information about former employees is a crucial first step. The policy should specify that the employer generally will offer neutral statements concerning a former employee, except under carefully described circumstances that warrant the disclosure of negative information (i.e., concerns about violence or sexual impropriety in the workplace). The policy should also designate the persons who are authorized to provide references on behalf of the company. Second, supporting the company’s policy with periodic training for those individuals who have been designated to provide reference information on behalf of the company is a good practice. Training will help the designated individuals to confidently and consistently respond to inquiries from prospective employers and will assist the designated individuals in keeping the company’s policy on references in the forefront of their minds. Finally, providing all employees with a copy of the reference policy and seeking a signed authorization granting permission to share information with prospective employers is helpful in insulating the company against claims arising from circumstances where the company feels compelled to share negative information about a former employee.

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